Good morning. Thank you for the kind introduction, and let me start by thanking Commissioner Salmon, Deputy Director Alcocer, and Commissioner Drusina. You've become such an important part of Federal Friday. Thank you for all your remarks and for being with us here today.

This is my 16th CRWUA. At my first CRWUA in 2002, if you were here, you remember that was a pretty memorable year. At the time I was a Senate staffer, I was a water and energy lawyer. It didn't occur to me once that I would be standing up here 16 years later as the Commissioner of Reclamation.

I was sworn in by Secretary Zinke on Monday evening. Tuesday morning, I flew to Las Vegas, and it's honor to join the women and men of the Bureau of Reclamation here at CRWUA.

As many of you know, I was with Reclamation a decade ago. Based on my experience, the rank and file and career leadership of Reclamation are a uniquely talented group of water managers and problem solvers.

In particular, in the Colorado River Basin, I'd like to recognize Brent Rhees and Terry Fulp for their deep knowledge and consistent leadership. It's good to be back.

I succeed a series of commissioners of high ethical and professional integrity, who I've had the pleasure to work with closely. I look forward to leading this organization, as we face the enormous ongoing and emerging challenges of western water management.

We need to ensure the Reclamation is able to meet its mission and provide dependable, reliable water supplies, not just for this generation, but for generations to come.

It'll be a pleasure getting to continue working with our partners among the tribal communities, the NGOs, water districts, and the Basin states. I very much look forward to building on and continuing our partnership and positive relationship with Mexico on the Colorado River.

As someone who has attended CRWUA for many years, some years are years of celebration. We enjoy progress. We stand on stage, and we sign things. Other years, leaders in the Basin call for action for challenges ahead.

For me, I see this as mixture. In small way, it's a time for greeting, me to you, you to me. But we have clear reason to recognize important progress and successes. But more importantly, it's a year in which we need to squarely face the growing risks we know are ahead of us in this Basin. I see a closing window of opportunity to take significant and decisive action to reduce those risks.

Action on the drought contingency plans in the Upper Basin and the Lower Basin is the foremost priority in this Basin. We're looking to the states to promptly complete their work.

But first, before discussing the challenges ahead, I'd like to recognize a number of milestones, and we have plenty. As has been mentioned at this conference already, 10 years ago this week, we signed the 2007 guidelines for Coordinated Operations of Lake Powell and Lake Mead.

We've gain valuable operational experience over this past decade, but what have we learned? Simply put, we've learned the guidelines are not enough.

To put it in perspective, in 2007, when we signed the ROD, system storage stood at 53 percent. Today, it stands at 54 percent. That sounds like a victory of sorts in a drought, but these levels benefit from a number of post 2007 efforts that I'll describe in a moment here.

In 2007, when the guidelines were adopted, based on the historic hydrology, we estimated that the risk that Lake Mead would drop below elevation 1020, and at that elevation, we have a little more than five million acre feet in the system.

Within the next five years, we thought that risk was two percent. It seemed like an acceptable risk. But that risk has grown by three to five times over the past decade. While there's been an extraordinary amount of effort to further protect the system since adoption of the guidelines, we're clearly far from done.

This year is also 10 years, as Commissioner Drusina mentioned, since the initiation of the United States Mexico Bi-national Cooperative Process on the Colorado River. At the time, few would have been able to predict that the bi-national process would grow into such a full fledged partnership. It serves as a world recognized example of trans-boundary partnerships.

Many predicted for this year that we wouldn't have a new Minute complete. But with the signing of Minute 323 and our celebration in Santa Fe this September, this focus of the Basin has now shifted back to drought contingency planning efforts in the states.

In another milestone, implementation of the Quantification Settlement Agreement is approaching the 15 year mark. Notwithstanding the controversies, litigation, the challenges, the QSA parties continue full implementation of this historic water conservation and transfer program.

Many predicted that the end of the mitigation flows this year, Salton Sea issues would descend into conflict and litigation. But instead, the Salton Sea, the state of California this month adopted a plan that serves as a roadmap to restore habitat and suppress dust along the margins of the declining lake in the coming years.

This action by California was the product of tremendous effort by Imperial Irrigation District, the San Diego County Water Authority, who all worked with Imperial County, the tribal groups, and a number of key environmental organizations.

In other good news, San Diego County Water Authority exercised its option extending the term of the QSA by 10 years, until 2047. The stability of the QSA is certainly enhanced by both of these actions.

In other matters related to the QSA, earlier this year, litigation over the San Luis Rey, Indian water rights, was finally resolved just last week. The parties have worked out implementing details for the delivery of conserved water from the canal lining projects in California.

Overall, I'd say tangible progress after decades of litigation, legislation, and negotiation. But what do these milestones tell us? That the Basin is usually at its best when it's facing deadlines. With the looming risk of prolonged shortages and the renegotiation of the 2007 guidelines not far away, our time to act is now.

As my new friend Commissioner Salmon said from this stage a few years ago, tick tock. The clock is ticking.

But looking northward to the Upper Basin and the source of most of our basin snow pack and runoff, the period from 2017 through 2000, they've been our driest 18 year period in our 112 years of record keeping on the Colorado. It's one of the driest 18 year periods we see in the 1,200 year paleorecord.

These are pretty daunting statistics. As a result of persistent drought, storage on the Colorado River system reservoirs has declined significantly since 2000. The combined storage of Lake Powell and Lake Mead is the same as it was in 1969, when we were just starting to fill the reservoir. Today, we stand at just about half full.

Early 2017 started with robust snow pack, but the way we ended was with Lake Powell only at 110 percent of average.

What about this year? Current snow pack, it's at 61 percent, we're watching conditions closely. But it's early. We know it could improve. It's only December. I think it highlights that the risk this Basin faces demands further action.

Given these conditions, many of you are working to develop additional tools in the Upper and Lower Basins. We applaud the Upper Basin states for their work on their drought contingency planning. It includes operations to protect critical elevations. It include demand management and augmentation.

A draft memorandum of agreement for an interim plan for drought operations has been developed amongst the Upper Basin states and they involve federal agencies.

In coordination with the Basin states, Reclamation has conducted modeling of the combined effects of both the Upper Basin drought operations and the Lower Basin DCP. We found that the combined effects of both of these plans, they end up protecting elevations and protecting hydropower, even in persistent drought.

We've also worked closely with the Upper Colorado River Commission, the Upper Basin states and funding partners to develop and implement the Upper Basin system conservation pilot program. The pilot resulted in savings of more than 21,000 acre feet of water in the Upper Basin over the past three years.

But looking at system conservation pilot program, we face some hard questions. How do we build a long term solution to meet something that's always changing on the river? Do we have options to quickly adapt to changing hydrologic conditions by accelerating, slowing, or maybe idling the program? How can funding sources support the kind of flexibility that we need?

The Upper Basin states are also actively looking at many institutional and water rights issues involved in ensuring the conserved water actually benefits Lake Powell. We support the Upper Basin states as they try to tackle these difficult issues.

Despite the modest recent improvement in system storage we've seen this year, the risk of reaching critical elevations in Lake Powell and Lake Mead over the next decade, it's unacceptably high. Current projections also show that Lake Powell and Lake Mead could reach critical levels as soon as 2021.

While there will be no shortage on the Lower Basin starting January 1st, there's still a 15 percent chance of a Lower Basin shortage next year. Chances of those shortages grow with each succeeding year.

What are we going to do? In addition to the efforts of the Upper Basin I mentioned just now, the pilot system conservation program in the Lower Basin has conserved 117,000 acre feet of system water. Participants in the program represent all seven Basin states, and it's comprised of agricultural, municipal, and tribal entities.

With that success, Reclamation, the Upper Colorado River Commission, and the funding parties recently initiated the process to continue this program in 2018.

But back in 2014, I think you'll remember a Lower Basin Drought Agreement was signed, just upstairs, to help protect elevations in Lake Mead. The goal of MOU was to create 740,000 acre feet of additional volume for Lake Mead by the end of 2017.

I think back then, we thought it was an audacious goal. But we expect by December 31st, we will have exceeded that goal. Well done, everybody.

Combined with water storage under the 2007 interim guidelines, ICS and deferred delivery by Mexico, all of these water conservation and storage activities have added approximately 1.6 million acre feet to Lake Mead storage, equivalent to about 20 feet in elevation.

20 feet. This volume has allowed the Lower Basin to avoid a shortage condition. Without these programs, either one of my predecessors, both who I think are here today, would have already...or maybe I'd be here, standing here about to tell you, announcing a Lower Basin shortage in two weeks.

Approximately 700,000 of this 1.6 million acre feet will have been stored or conserved in 2017, including significant amounts conserved by Metropolitan Water District, in an unprecedented effort that was supported by all seven Basin states.

We also has new parties making contributions to Lake Mead storage. This year, Reclamation and new funding partners, the Arizona Department of Water Resources, the City of Phoenix, the Walton Family Foundation, they all provided funding for one of two system conservation agreements with the Gila River Indian Community this year.

These are all your accomplishments, these and others. I hope everybody is proud of what we've done this year.

While these water conservation and storage activities have been successful, Lake Powell and Lake Mead clearly remain at risk. The Department of Reclamation continues to work collaboratively with our partners Basin-wide to develop consensus based drought contingency plans in both the Upper and Lower Basins.

These plans will bridge the gap until new operational guidelines can be developed by 2026 to ensure the sustainable operation of Colorado River systems for the longer term.

The Lower Basin is developing a drought contingency plan comprised of proactive water conservation and system efficiency improvement actions, actions that will result in additional water in Lake Mead and significant reduction in the risk of reaching critically low elevations.

As Kevin Kelly said yesterday, these actions will work as an overlay to the provisions of the 2007 interim guidelines.

To anyone even remotely familiar with our Colorado River Basin, it's clear that partnerships are the essential element to progress. You know it, we know it. The seven Basin states in the water district are key partners with Reclamation. But these traditional relationships are only one piece of the puzzle that we need for progress.

A great example has been working with the NGOs, whether in the Upper Basin, the Salton Sea, or the Colorado River delta, their creativity, their engagement, and more and more their funding is critical to our successes.

Reclamation also actively works with tribes and others in the Basin to advance and implement water settlements and address the needs of Indian country. We continue to work closely with Native American tribes across the Basin, and we're making substantial progress implementing several Indian water rights settlement projects.

For one, we're working with the Navajo Nation and the state of Utah to finalize a settlement of Navajo Nation water rights claims within Utah. We're continuing to make good progress constructing the Navajo-Gallup Supply Project, which is the cornerstone of the Navajo Nation water rights settlement on the San Juan River Basin in New Mexico.

Yesterday, I want to say we had a very meaningful discussion with the Ten Tribes Partnership. I stress the importance of honoring tribal sovereignty as we work together.

We continue work, and we hope to soon finish a tribal water study. This will be a groundbreaking, essential resource describing the tribal water supply and demand challenges and opportunities in the years ahead.

Our other partnerships, they certainly include the Republic of Mexico. Over the past decade, perhaps no area on the Colorado River has seen more progress than the development of the bi-national relationship with the United States and Mexico.

I commend Commissioners Drusina and Commissioner Salmon on their effective hydro-diplomacy. Both countries have benefited greatly from the work of the Commission and it's commissioners.

During my prior tenure at Interior, our position was that while it was certainly possible to find cooperative solution mechanisms to improve Colorado River Management for both countries, doing so was going to have to be within the framework of the 1944 Treaty and the law of the river.

Time and experience has proven that was entirely correct. Under Minute 323, water users in both countries will be able to continue to proactively plan for a range of water supply conditions, based upon Lake Mead's elevation.

As we close out implementation on Minute 319, we are very pleased to announce -- my friends, the commissioners, beat me to it -- that Mexico has completed the exchange of water to the US this week. This water will be accredited as bi-national ICS and will be transferred and credited to our funding partners in the United States.

We're also aware that Mexico is in the final stages of identifying water conservation projects for funding under Minute 319. As Commissioner, I want to ensure our Mexican partners, here publicly, the funding required for those projects will remain available for that and only that purpose.

The most important innovation in the new Minute, signed in September is the inclusion of a new concept of bi-national water scarcity contingency plan, whereby additional water savings will implemented by Mexico when Lake Mead reaches certain low elevations. This proactive program is conditioned on the finalization of a US drought contingency plan.

Let me give particular credit to the leadership from Mexico. Your focus on the importance of additional actions to protect our shared resource and your willingness to include contingent bi-national water scarcity element in Minute 323 demonstrates real leadership in water management in the Basin.

We applaud your success and recognize the burden is now clearly on the US to take necessary actions, forge the domestic partnerships and make the compromises necessary to further this essential element of Minute 323.

When the US adopts the anticipated Lower Basin DCP, the bi-national water scarcity contingency plan will automatically become effective, benefitting water users on both sides of our shared border.

As I hope is evident throughout my remarks, adoption of the DCP is needed, and it's needed soon. Adopting the DCP will protect the Basin against a deepening or worsening drought. Adopting the DCP will lead to parallel actions of water savings in Mexico. Adopting the DCP will reduce the risk that the Basin descends into crisis just as we sit down to develop our post 2026 operational rules.

We've all heard about the importance of DCP each year here at CRWUA. Having taken important steps with Mexico to assure the adoption in the US will automatically lead to parallel savings in Mexico, what are the prospects now for completion of the DCP?

First, for a quick reminder, the core elements of the Lower Basin DCP have not changed in over a year. It will provide for more water savings sooner at higher elevations in Lake Mead. It will also provide new incentives to leave even more water in Lake Mead, knowing that it can be withdrawn later when it's needed.

Success rests on actions in Arizona and California. Reclamation is committed to work with both of them to help resolve and finalize a path to completion of DCP. The interstate issues will require careful compromises and prompt action.

Lest I be remiss for not mentioning it here, our host state here at CRWUA, I can report that back in Santa Fe in September, Nevada indicated it was ready to sign on to Lower Basin DCP, and I'll rely on those public comments.

Of course, even without the DCP, with nearly $1.5 billion invested in the new Deep Tunnel all the way to the very bottom of Lake Mead, Nevada has its own drought contingency plan ready.

The Interior Department stands ready for greater engagement, as appropriate, to help facilitate the state's progress on establishing the conditions for adoption of the DCP. As I mentioned at the start of my remarks, it is obvious that the window for adoption is closing. The probability of reaching shortage nearly triples between 2019 and 2020.

2018 provides an important opportunity to adopt the DCP before the Lower Basin has reached shortage.

Having said that, it's clear that Interior simply can't want the DCP more than the states. For DCP to succeed, the states need to act with Interior as partners. The benefits of action, the burdens of inaction rest squarely with the states right now.

In closing, I think I'd like to say thank you all for welcoming me so warmly here at CRWUA and to Reclamation. I'd also like to thank the CRWUA leadership. I'd like to thank all the people who sit on and volunteer for those committees that make this conference such a success every year.

I want to say Merry Christmas, happy holidays to you and your families. Travel home safely, and I very much look forward to working with each of you in 2018. Thank you.